Weak economy could bite ANC in polls as it did Republicans
• Fallout such as VAT increase is making it increasingly difficult for citizens to make ends meet
In 1991 the campaign team for US Democratic candidate Bill Clinton had a tough job. Sitting president George Bush Sr had already achieved considerable success during his presidency with his role in the fall of the Berlin Wall and the break-up of the Soviet Union, and his decisive action on Iraqi aggression in the Persian Gulf made him immensely popular. A poll carried out in March 1991 shortly after the ground invasion of Iraq as part of Operation Desert Storm measured his approval rating at a staggering 89% — the highest yet recorded by Gallup.
Yet despite these successes Bush had an Achilles heel that would ultimately cost him the 1992 election: the state of the US economy. Clinton strategist James Carville coined the phrase “the economy, stupid” as a constant reminder to the campaign team that the everyday hardships experienced by voters as a result of the 1990-1991 recession would be more influential on their voting decisions than foreign policy — and he was right. Clinton won the election by a huge electoral margin, defeating Bush and ending a 12-year streak of Republican power in the White House.
The ANC is in a similar position. After the removal of Jacob Zuma at the end of 2017, public support for Cyril Ramaphosa has been so overwhelming it has been dubbed “Ramaphoria”.
The new president has made sweeping changes at stateowned enterprises, rooted out corruption and otherwise talked a strong game around rebuilding confidence and providing policy certainty. But it may not be enough. Despite everything Ramaphosa has done, the state of the economy remains a nagging reality that is unlikely to go away before the elections.
The shocking first-quarter growth figures released last week, coupled with the precipitous decline in the rand over the past week, are a manifestation of the economic pressures the public is under.
The VAT increase, stagnating credit extension, the sugar tax, a weaker rand, labour disputes and crumbling infrastructure are all making it increasingly difficult for South Africans, irrespective of income level, to make ends meet.
To be fair, it would be unreasonable to think Ramaphosa could undo the years of damage done to the economy by the Zuma administration in a few months, but when it comes to voting day, one wonders if that will even matter.
RECORD PRICES
Keen readers of this newspaper and a small number of others with an interest in financial markets will know that a large part of the rand’s recent depreciation is the result of a shift in international risk appetites, as well as expectations around US and European monetary policy.
Similarly, the abysmal growth figures were made worse by a huge decline in agriculture due to the drought.
These are things over which the government has no control, but even if people know this it is cold comfort when they are paying record prices at the petrol station or being told that they won’t be receiving a salary increase in 2018 – if they have a job at all.
The ANC has had control over economic and policy decisions for the past 24 years.
Many of those years were fruitful and SA experienced strong growth for more than a decade, but in the minds of the voting public those memories are rapidly fading. The lived experience of the majority of South Africans will be far more important than the “Ramaphoria” reported in the media — and people are really struggling.
More than half of the youth are unemployed, education is in a shambles, debt is rising, and even with a new board the future of Eskom is still not clear. As much as sentiment has improved, the fundamentals therefore really haven’t.
The real question is how well the opposition mobilise in this environment. For all of its strategic brilliance in driving niche issues, the EFF still lacks sufficient depth to gain a threatening foothold within the ANC’s constituency. That is not to say it will not experience significant growth in the next election, but to some extent it has become a victim of its own success.
The way the EFF has forced the ANC to adopt its stance on issues such as land expropriation without compensation and, bizarrely, the renaming of Cape Town International Airport, shows how effective it is at identifying populist issues.
For the ANC the biggest challenge from the EFF is that poor economic conditions have made the ground fertile for populism, yet adopting populist positions will only make economic conditions worse.
Regarding the DA, one can only wonder. Having previously experienced enormous growth due to the promise and execution of good governance and a strong commitment to social mobility, the leadership seems to be fragmented and to have lost sight of a vision — for itself or the country. Without a clear identity or strong leadership it is hard to make a compelling case for voting for the DA other than for being the official opposition.
For the ANC none of this should be reassuring. In politics things can change extremely fast — just ask Bush.
In the same way that the Republicans’ 12-year winning streak was broken by the grinding effects of a recession, the ANC could find itself scrabbling for votes at the polls in 2019 if economic conditions don’t improve soon.
LIVED EXPERIENCE OF THE MAJORITY OF SOUTH AFRICANS WILL BE FAR MORE IMPORTANT THAN ‘RAMAPHORIA’